Former U.S. President Bill Clinton once said: “The price of doing the same old thing is far higher than the price of change.” These words should resonate strongly with anyone who read Sir Bill Jeffrey’s independent review of criminal advocacy in England and Wales – published last year – in which he issued the stark warning that “carrying on as at present… does not seem to me to be a viable option”. In the face of radically changing market conditions, adjusting the way in which the Bar does business is paramount to the profession’s prosperity.
As the regulator of the Bar, it is our job to do what we can to enable barristers to adapt their business models so they best meet their clients’ needs. We have done exactly this. At the start of the New Year, we opened our doors to applications from individuals and groups of individuals wishing to set up Bar Standards Board (BSB) regulated entities – companies, partnerships, or LLPs, owned and managed by lawyers.
Even though barristers have long since been able to set up entities under other approved regulators (the Solicitors Regulation Authority, for example), there is evident excitement and enthusiasm among barristers to form entities regulated by us. BSB and Bar Council research published last summer showed over a third of family barristers and more than a quarter of criminal barristers had definite or possible intentions to become involved in an entity. In the first five days of accepting applications we had as many as 30 applicants begin the process of setting up a BSB-regulated entity. At the time of writing, we have had over 50 expressions of interest and eight completed applications.
To be clear: we have no desire simply to replicate existing models of entity regulation. Our aim is to provide those wanting to specialise in advocacy and litigation with a specific and focussed regime. We have no desire to try to regulate entities that focus on, say, licensed conveyancing, or entities that hold client money, for example. We want our regime to remain simple, but we believe that, as business models change, the Bar’s skills and expertise should be preserved and protected. Standards of advocacy must be maintained. This benefits barristers; it benefits the public. Everybody wins.
The benefits for barristers are numerous. Barristers and other advocacy-focussed lawyers will now be able to form entities without having to change regulators. They will be better placed to pool resources and share the risks of investing in their own business. Barristers that do not wish to conduct litigation could seek to enter into a co-ownership agreement with solicitors so that their entity can offer clients a full range of services, from start-to-finish. The possibility of a more secure practising model may also help promote retention and diversity – particularly for those for whom self-employment is not an option.
Aspiring pupils should take note, too. We know how tough the market is right now for those seeking pupillage. Under our new regulatory regime, entities can create innovative ways to develop promising people, employing them within the entity, and growing their skills until opportunities for pupillages arise
Our regime is distinct in that, although it is a new endeavour, it is built upon that traditional and steadfast foundation of advocacy regulation: individual responsibility. It matters not whether carried out within an entity or by a barrister working on a self-employed basis: the advocate’s responsibilities to the court and their clients are just the same.
Our primary duty is, as it always is, to promote high standards of practice and safeguard clients and the best interests of the public. We believe that becoming a regulator of entities will help encourage new advocacy-focussed business models to emerge and flourish, which in turn will broaden client choice. In instances where entities offer litigation services, they will be able to provide clients with a “one-stop-shop” for the services they need – making the process less complicated. In terms of safeguarding, clients may be reassured that when they access the services of a BSB-entity they are protected by a “double-lock” style system of regulation in that both the entity itself and the individual barristers within come under our regulatory remit. BSB-regulated entities will rightly be subject to ongoing supervision. After all, our job is to protect the public.
During this process many have asked about our progress towards becoming a regulator of Alternative Business Structures (ABSs). We are talking with the Legal Services Board about this and we will send our application to regulate ABSs later this year. Once approved, the business models we regulate will be different, but our rationale will remain the same: that is, helping those who want to adopt new business models do so, so as to continue to meet clients’ needs. That is what we are here to do.
This is the beginning of a major chapter in the story of the Bar – what legal services look like and how the public accesses them. Against what is for many a backdrop of uncertainty and change, we hope this will give barristers more freedom to react to changes in the market and to devise new ways of working so as to remain competitive and best serve their clients. It is a real opportunity – one I hope will not be missed.
|Interested in setting up a BSB-regulated entity? Here’s what to do:
The first thing is to get in touch with us. The application process will also work more smoothly if we talk to you informally before you send us your application. Please get in touch via email@example.com or 0207 092 6801.
Entity applications are considered on a first-come, first served basis, so – like completing a tax return – it really is best not to leave it until the last minute. The sooner we receive your application the sooner we can begin to process it.
When you apply, you will need to tell us about:
· The type of entity you want to set up;
· The type of work you wish to do;
· The way in which your entity will be managed; and
· Its ownership and governance structures, etc.
Usually, you should receive a decision within six months. However, this – and the fees you will have to pay – all depends on the complexity of your application. If you have taken the time to talk to us about your proposed entity before submitting your application than the time frame is likely to be shorter. So it is really worth getting in touch with us first.
You will have to pay:
· An application fee (this covers the cost of processing your application – everyone who applies needs to pay this);
· An authorisation fee (this covers the cost of regulating your entity in its first year of authorisation – only those whose application is successful need to pay this);
· An annual fee (this covers the costs of regulating your entity in its second year and beyond).
Finally, if your application is not quite right, that does not mean we will simply reject it outright. Our entity regulation team will be in touch to discuss with you how it can be improved and the points or issues that you may have not yet covered first time around.
By Oliver Hanmer (Director of Supervision for the Bar Standards Board)